On Tuesday of this past week the National Consumer Law Center (NCLC) published a report entitled “Debt Collection Communications: Protecting Consumers in the Digital Age.”  The 25-page report was sent to the Consumer Financial Protection Bureau (CFPB) for their consideration in their upcoming Debt Collection Rulemaking.

NCLC (http://www.nclc.org/) is a nonprofit organization advocating consumer justice and economic security for low-income and other disadvantaged people, including older adults, in the U.S.

Historically, NCLC has been quite active and vocal on a variety of debt collection issues. In March of 2014 insideARM reported  on the NCLC 200 page response to the CFPB’s debt collection ANPR.  In January of this year insideARM published a story on NCLC’s call to the CFPB to create an outright ban on collection of “time-barred debt.”

In this latest publication NCLC suggests that the CFPB should issue regulations in a number of different areas regarding “communications” with consumers.  This article will discuss just a few highlights.

1)      Provide a specific limit for the number of telephone calls to consumers.

NCLC proposes that a debt collector can call a consumer about an account in collection up to three times a week (Sunday to Saturday), but if the debt collector speaks to a consumer by phone the collector cannot initiate any further phone calls that week unless the consumer requests additional contacts.   Further clarity of this point includes:

If no one answers, the debt collector can leave a voicemail after each call (where the voicemail message otherwise complies with the FDCPA).

Every time that the debt collector causes the consumer’s phone to ring should count as one call, whether or not the debt collector actually speaks to the consumer or leaves a voicemail message.

Calling the consumer at any of the consumer’s phone numbers counts towards the three call limit per week.

2)      Prohibit calls or text messages to cell phones without express consumer opt-in. 

NCLC suggests that CFPB should use its authority to go beyond the restrictions in the Telephone Consumer Protection Act (TCPA) and provide an overlay of regulation for all debt collection calls and texts to cell phones, whether the calls are made by a robo-dialer or by hand.

Further clarity on this point includes:

All debt collection calls and text messages to cell phones be prohibited absent prior express consent by the consumer (regardless of whether the calls are initiated by autodialer);

Consumer consent to receive calls or text messages on their cell phone can be withdrawn at any time; and

Consumers can withdraw their consent orally.

3)      Require that collectors provide consumers with notice of consumers’ right to stop collection communications and honor that request when made orally by consumers.

NCLC suggests that the CFPB should require that debt collectors provide the following information to consumers: 

We will stop contacting you if you tell us to stop or that you refuse to pay. 

NCLC further suggests that his disclosure should be required in all written and oral communications with the consumer.  If the notice is in writing, it should be in large type on the front page and set off by typography, margins, or in a boxed area.

4)      Require Use of the Foti message

Buried in page 14 of the report is the following nugget:

The CFPB should codify current case lawto ensure that Foti v. NCO Financial Systems, Inc., 424 F. Supp. 2d 643 (S.D.N.Y. 2006) remains the rule.  Unless the consumer specifically opts-in to voicemail communications from the debt collector at that phone number, collectors should be permitted to leave voicemail messages only when the outgoing voicemail message indicates that the message is private to the consumer who allegedly owes the debt.

The report discusses many other communication issues.  To review the complete report click here.

insideARM Perspective

While the NCLC suggestions may not be palatable to many in the ARM industry, there is some area of common ground.

First, while reasonable people may disagree on the number of call attempts, insideARM believes the entire ARM industry would prefer to have call frequency ambiguity removed.  If specific limits are set, the industry can act within specific limits. Second, clarity around certain provisions of the Fair Debt Collection Practices Act (FDCPA) would be helpful.

But, having said the above…

The suggested frequency limits are probably too restrictive.

The proposed cell phone restrictions are Draconian considering the fact that people are moving away from land line phones in droves. Communication is still critical to resolution of outstanding debt.  The NCLC suggestion on cell phones could make communication with consumers nearly impossible.

The NCLC is suggesting additional language to the mini-Miranda disclosures in all communications. When do too many mandatory disclosures render the entirety of the disclosures meaningless?

Finally, the NCLC suggests mandating use of the Foti message? I don’t believe there is any consensus within the ARM industry that Foti is the best message for consumers for voicemails.


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